Arapahoe County human services warns of roughly $2.9M funding shortfall as grant‑funded caseloads rise

Arapahoe County Human Services Director Dan McKelkey told commissioners that the department projects a near‑term funding shortfall driven by rising caseloads, the end of one‑time federal recovery dollars and state and federal rule changes.

McKelkey said the department currently expects a county match shortfall of about $2,890,000 in 2025 if no additional revenue or program changes are adopted, and that shortfall could grow in subsequent years depending on federal and state appropriations. He described the shortfall as tied to the county’s required local match for multiple programs rather than a single line item.

Why it matters: Human Services administers SNAP (food assistance), Medicaid eligibility/redetermination, child care assistance, TANF/Colorado Works and child/adult protective services. McKelkey and his leadership team said program demand — and the paperwork burden for medical redeterminations — has increased since the pandemic and the department has exhausted many temporary funding sources.

Caseload and workload detail: the department reported recent changes and volumes including: - Food assistance caseload: from about 28,000 cases in 2022 to roughly 34,500 cases in 2024–2025 (about a 45% increase from 2019 levels). - Medical assistance (Medicaid): caseload counts fell as the redetermination process resumed, but the paperwork grew from a handful of pages to roughly 50–55 pages for a typical renewal, increasing staff time per case. - Child welfare: the department outlined an intake “funnel” of roughly 14,000 referral calls, about 5,000 screening/assessments and roughly 600–700 active child welfare cases, with the amount of complex, higher‑need families rising.

Causes and recent rule changes: McKelkey and staff said a Colorado rule change on child care meant counties must accept childcare cases transferred from other counties (a change Smith likewise flagged for Community Resources), increasing caseloads. The department also cited House Bill 22‑1259 (state benefit adjustments) and the recent Joint Budget Committee childcare allocation as material influences on funding and how counties record expenditures.

Options and board guidance requested: Human Services staff said they are using multiple strategies to reduce the projected shortfall: identifying contract reductions and reprioritizing services, examining internal staffing allocations, pursuing surplus distributions from the state settlement process, and seeking available inter‑county allocations where other counties have underspent contractual funds. The department emphasized it will not request FTE in 2025 beyond existing authorizations but will bring prioritized, specific program and contract options during the formal 2026 budget cycle.

Board discussion highlights: commissioners asked for clarifications about which contracts and community partners could be affected if the county reduces child‑welfare or other program contracts, and whether ARPA and other recovery funds had masked the underlying gap. McKelkey and staff said the December–August budget timeline is the next opportunity for formal decisions and that some surplus or settlement corrections from the state could change the projection.

Ending: McKelkey said the department will submit formal 2026 budget requests and memos responding to board questions; commissioners asked staff to produce more granular contract lists and cost scenarios for potential policy choices.